Providing Creative Solutions For Automotive Dealers

Do you feel lucky? …Well do you?

For publicly held corporations, the Sarbanes-Oxley Act of 2002 requires a company listed on the stock exchange to have a compliance program. Luckily many of our retailers are not listed on the stock exchange. But it is being promoted for us to voluntarily develop a compliance program to match the current regulations and other requirements of Federal and State government agencies.

During my visits across the country, I discover everyone wants to comply and follow the letter as well as the spirit of the law. It is just no one wants to be the first to have to have to determine what the rules should be. We all know the importance of a guide book, rules that we know we can follow. I mean what would sport games be without rules, or how would be your trip to the office if we did not have any traffic laws?

Deep down we know developing a set of rules to follow is not easy. It takes a considerable about of time and effort to determine how to work around the various mind fields our local and national government has put into place, yet deep down we know it has to be done.

Recently I was on hand to view an on-site warranty and down payment audit. The organization that requested the audit was performing a general review with a well known automotive retailer. During the audit it was discovered that several VSC contracts had somehow slip between the cracks and was never sent off to the warranty company. In addition, it appeared that a few down payments did not get collected at the time the installment contract was signed.

All of this is small common mistakes we see very day in many retail operations. Nobody was planning to harm or trick any customers. But at the end of the day, the retailer was cut off from a well known bank and loss their warranty company. In addition, it appears they will be hit with a few fines and maybe have to buy back a few contracts.

You might be wondering why I have taken the time to even write this. In short it is because many retailers still believe they can get away with by passing some of the regulations and laws because they consider them “unfair” or they believe they are not large enough for anyone to notice what they are doing. They might be right, but as Clint Eastwood said one time in a movie…”Do you feel lucky?..Well do you?

This is not a movie and we are not Clint Eastwood. Make sure you understand your obligations under the law.